Notable Equity Linked Products

AmFIRST Real Estate Investment Trust’s (“AmFIRST REIT”) Rights Issue was the first (1st) rights Issue for Real Estate Investment Trusts in Malaysia (“MREITs”).The well response and success of the AmFIRST REIT’s rights issue has boosted confidence of the unitholders /potential investors to participate in MREITs’ rights issue. This set a benchmark for other MREITs to launch rights issue in Malaysia.

Garnered overwhelming interest and demand, the rights issue was well received with a subscription rate of 113.48% or 292.09 million units despite volatile market condition, indicating strong unitholders’ confidence in value and growth potential of AmFIRST REIT.

The rights issue allowed AmFIRST REIT to reduce its gearing ratio its gearing ratio from 45.9% to 29.68%, thus providing additional debt headroom of up to RM480 million and allowing AmFIRST REIT to respond immediately to potential yield accretive and strategic acquisitions.

After the rights issue, the market capitalization increased by 71.2% from RM445 million (as at 22 June 2012, being the date of announcement for rights issue’s book closure date) to RM776 million (as at 18 October 2012).

Dialog Group Berhad’s (“Dialog”) Rights Issue with Warrants was well received with an oversubscription of 65.01% or 258.0 million Rights Shares, indicating strong shareholders’ confidence in the value and growth potential of Dialog and its subsidiaries.

Proceeds raised are largely utilised for investment in the Company’s upstream oil and gas activities, including the development and of petroleum under risk service contracts with Petroliam Nasional Berhad, the development of Pengerang independent deepwater tank terminals as well as working capital.

Dijaya Corporation Berhad (Mar 2013)

Value :
Role :
Deal Nature :

RM319.12 million
Adviser
Renounceable Rights Issue

Dijaya Corporation Berhad’s (“Dijaya”) Rights Shares total valid acceptances and excess applications received were approximately 72.2% or 265.9 million of 368.5 million Rights Shares. In view of the abovementioned subscription level, the minimum subscription level for rights issue to raise gross proceeds of RM250 million has been achieved.

Proceeds raised are to be utilised to partially settle the purchase consideration for the acquisition of identified properties and identified companies by Dijaya for a total consideration of RM934.7 million.

Landbank to be acquire increases Dijaya Group’s total landbank to 870 acres and enhance gross development value (“GDV”) by RM6.1 billion. The enhance real estates portfolio mix and increase in landbanks will transform Dijaya Group into one of the largest property developer on Bursa Securities.

The Rights Issue with Warrants of MBM Resources Berhad (“MBMR”) garnered strong interest and demand and was considered an excellent outcome with subscription rate of 112.16% or 82.06 million shares, indicating strong shareholders’ confidence in the value and growth potential of MBMR and its subsidiaries (“MBMR Group”).

Proceeds raised are largely utilised for the repayment of part of the Company’s existing bank borrowings which are incurred in connection with the acquisition of Hirotako Holdings Berhad via a take-over offer and for MBMR Group’s investment for the expansion of its retail and service network and its automotive manufacturing division.

The Rights Issue with Warrants enables MBMR Group to fund part of its business expansion plans which will potentially offers additional growth in revenue to the MBMR Group and bolsters MBMR Group’s competitiveness in the automotive industry in Malaysia.

The rights issue was part of TH Heavy Engineering Berhad (“THHE”) regularisation plan to uplift its PN17 (financially distressed entity) status which restricted THHE from securing oil and gas contracts.

The rights issue was considered garnered strong interest and demand although the subscription rate was only 99.5% million shares, indicating strong shareholders’ confidence in THHE’s restructuring plans.

Proceeds raised are largely used to fund yard acquisition and improvement works on the yard. The yard acquisition provide THHE an immediate opportunity to turn around its business to become major offshore fabrication by participating in fabrication contract in both domestic and international oil and gas industry.

The rights issue was well received and the demand was so strong that it was oversubscribed by 35.80% or 30.34 million shares despite the volatile market condition, indicating strong shareholders’ confidence in the value and growth potential of Yinson Holdings Berhad (“Yinson”) The rights issue enabled Yinson to raise the requisite funds without having to incur interest expense or service principal payment.